Further Gold Rebound Possible to $1,171/oz
July 29, 2010 12:25
Gold rebounded on Thursday as the U.S. dollar weakened against other currencies but gains could be limited after holdings in the world's largest gold-backed ETF dropped to their weakest since early June.
Spot gold could rebound to a range between $1,171 and $1,176 per ounce as a five-wave cycle has completed during the fall from $1,194.80 to $1,156.90. A Fibonacci retracement analysis marks two possible targets at $1,171 and $1,176 - the 38.2 percent and 50 percent levels.
However, pinpointing the exact level for the rebound is difficult, as gold may stop at $1,171 or $1,176, or in-between. Conservatively, the $1,171 level should be targeted. A break below support at $1,156.90 will open the way to $1,140.20 - the 100 percent Fibonacci projection level of wave (3) or wave "C".
Graphic below showing spot Gold technical outlook, source Thomson Reuters
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